San Diego Pension Reform Ballot Initiative — the biggest untold story of 2012

Legal Insurrection ^ | 1/22/2013 | Leslie Eastman

[Kolath]

Professor Jacobson made an exceedingly important point yesterday: Our focus must be on “changing what we can change, protecting what we can protect, undermining what we can undermine, acting locally.”

Based on my experience in San Diego, I cannot stress enough the vital role that local activism is playing in fiscal reform.

Here is Exhibit A as proof of the success of can-do citizen activism: Proposition B – San Diego’s Pension Reform Initiative.

The measure, which passed in June 2012 with over 65% of the votes, put new city employees (except police) into a 401(k) style pension, rather than a defined benefits package.

This measure was spear-headed by Carl DeMaio, the former San Diego mayoral candidate and City Council member, who has now turned into a taxpayer watchdog by organizing two separate reform groups (one focused on San Diego, one on California).

[Oldexpat]

Unfortunately the law didn’t go far enough. We should have converted all the current employees to a 401k preserving their already earned defined benefit pension. It will take years to have a positive impact on city finances now and the city still is spending too much on pensions.

[Ken H]

And police are exempted because...?

[USNBandit]

It could be because they have an earlier retirement age. The crazy thing is a lot of these localities would save a lot of money if they transitioned even to a program like federal employees have.

I can only speak to fire and police retirements, but they are really expensive in California. LA fire gets something like 90% of their high three after 20 years and 100% at 25 years. That includes the ability to work lots of overtime to spike the last three years earnings. Why would somebody keep working if they made more by not working?

The reason a lot of feds keep working until they hit mandatory retirement age is because they make a fraction of their working salary in retirement and pays to work longer.

[wac3rd]

Here’s the kicker...

The State of California matches your 401K contributiot in 100%.

So, put in $5K, they match $5K.

What a state! What a country!